Apple to pay Samsung’s UK legal fees due to “lack of integrity”

The judge says Apple engaged in "false innuendo" in its original notice.

The England and Wales Court of Appeal has ordered Apple to pay all of Samsung's legal fees arising from a dispute over whether or not Samsung violated Apple's registered design for a tablet computer. The order comes after Apple flagrantly thumbed its nose at a previous court order requiring Apple to post public notices that Samsung did not infringe, instead using the notice to claim other courts had concluded Samsung "copied" the iPad.

Apple has sued Samsung in the US and around the world, alleging Samsung copied Apple's designs and technology for the iPhone and iPad to make its own competing Galaxy smartphones and tablets. But Samsung filed a lawsuit in the UK to get an affirmative declaration that Samsung's tablets did not infringe on a registered EU community design for a tablet that Apple says formed the basis of the iPad that was released in 2010.

A UK High Court judge ruled that Samsung did not infringe on the design, and the Court of Appeal later affirmed that decision. Apple was ordered to post a notice on its website and in several UK publications noting that the court found that Samsung did not infringe Apple's design right. The order's intent was to counteract the publicity over the court battle, in which Apple repeatedly called Samsung a "copy cat."

Apple added additional text to the court-ordered notice which suggested that other courts found Samsung in violation, including a US jury that awarded Apple $1 billion in damages.

The Court of Appeal called the move a "plain breach of the order," and ordered Apple to post a revised statement that did not mention other court rulings or claims of "copying" the iPad.

In addition to further stipulations about how the notice must appear online and in print, however, the court further ruled that Apple must pay Samsung's legal fees on an "indemnity basis."

"Such a basis (which is higher than the normal, 'standard' basis) can be awarded as a mark of the court's disapproval of a party's conduct, particularly in relation to its respect for an order of the court," Robin wrote. "Apple's conduct warranted such an order."

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It might be worth noting that the UK courts ordered Apple to pay Samsung's incidental costs, not just the legal fees. This includes costs the court would not typically award such as cups of coffee, taxi fares and the like; basically, every penny the lawyers spent on the proceeding.

Apple (and its lawyers) aren't stupid. They had to know that there would be repercussions for thumbing their nose at the court so flagrantly. Presumably they must have decided that the benefits of doing so outweighed the downsides. I wonder if that calculation took into account however many millions of dollars of Samsung's legal fees that they'll now be paying.

Apple (and its lawyers) aren't stupid. They had to know that there would be repercussions for thumbing their nose at the court so flagrantly. Presumably they must have decided that the benefits of doing so outweighed the downsides. I wonder if that calculation took into account however many millions of dollars of Samsung's legal fees that they'll now be paying.

Agreed, but you have to wonder about the longer term ramifications. UK courts looking down on apple for this kind of conduct isn't going to help them if they ever wish to open another suit in the UK... probably even worse if someone opens a suit against them! Immediately puts them on the back foot meaning their conduct would have to be impeccable!

Well I doubt the fees will be exceedingly large, but its good to know that Apple won't get away with just a stern talking to. Although in the end, it is still pretty much just a slap on the wrist.

With the amount Apple have piled up, anything short of an absurd amount would be a slap on the wrist that they wont even remember, but a few slaps to their ego (which they have gotten here) , they are not going to forget for a loooooong time.

Hubris. It's a learning moment when I explain it's consequences to my kids. It's a tactical facepalm when grown adults, who really should know better, blatantly practice it and act surprised when called on it.

Gotta wonder how much longer current patent laws can remain so fundamentally broken. The only ones currently profiting from it are law firms and non-producing patent trolls. Any tech company actually involved in making a product must spend at least twice as much in legal fees and lost battles as they gain in successful suits. Reminds me of the copyright field before notions of fair use were defined, the current system is too heavily biased in favor of patent holders at the expense of patent users. Adding insult to injury, the entity holding the patent rarely produces anything with said patent and oftentimes contributed nothing to it's original development.

Agreed, but you have to wonder about the longer term ramifications. UK courts looking down on apple for this kind of conduct isn't going to help them if they ever wish to open another suit in the UK...

I wonder how much that kind of thing can/does affect a lawsuit.

Normally you would expect the court to treat suits on a case-by-case basis, and deal only with the matters at hand, and not the company's record of past behavior in court.

Are things like this allowed to be taken into a consideration? Does it happen anyway in practice?

I'm not a lawyer, but I'm curious if something like this could actually backfire on Apple in a future lawsuit.

Gotta wonder how much longer current patent laws can remain so fundamentally broken. The only ones currently profiting from it are law firms and non-producing patent trolls. Any tech company actually involved in making a product must spend at least twice as much in legal fees and lost battles as they gain in successful suits.

That's naive, and untrue.

The tech giants are all in favor of patents, not just because their lawyers love the situation, but because it's a net benefit for them. Yes, they're getting sued left and right, but because the patent laws are as broken as they are, they can generally use their patent portfolio to keep out smaller upcoming competitors, so they only have to worry about the other members of the "big patents club". Apple, Microsoft, Samsung, IBM etc. can just cross-license and settle with each others to allow them all to do business pretty much unhindered. And at the same time, their massive patent portfolios means that if anyone *else* were to try to muscle in on their markets (say, launch a new phone), well, they get hit with a few dozen lawsuits.

I'm sure Microsoft and Apple hate getting hit by lawsuits, but they're still in favor of the patent system because overall, to them, the benefits outweigh the disadvantages.

Imagine how risky Apple's position would be if *anyone* could just start designing and selling phones, for example. Avoiding that situation is well worth getting hit by the odd lawsuit.

Agreed, but you have to wonder about the longer term ramifications. UK courts looking down on apple for this kind of conduct isn't going to help them if they ever wish to open another suit in the UK...

I wonder how much that kind of thing can/does affect a lawsuit.

Normally you would expect the court to treat suits on a case-by-case basis, and deal only with the matters at hand, and not the company's record of past behavior in court.

Are things like this allowed to be taken into a consideration? Does it happen anyway in practice?

I'm not a lawyer, but I'm curious if something like this could actually backfire on Apple in a future lawsuit.

I am also not a lawyer, but I would think it's certainly plausible. Courts use the precedents set by verdicts from past cases; why can't they use the precedents set by court orders in those cases too? Apple having a court order against them due to misconduct seems like a usable precedent if they start the same shenanigans in a future case.

It might be worth noting that the UK courts ordered Apple to pay Samsung's incidental costs, not just the legal fees. This includes costs the court would not typically award such as cups of coffee, taxi fares and the like; basically, every penny the lawyers spent on the proceeding.

Sorry, but I'm increasingly curious if Sir Robin Jacob just really enjoys having power over such a large company and is maybe letting it go to his head a bit. Requiring an apology in the first place was a surprise; the rest just looks like vindictiveness.

If you think you're above the law and act in contempt of a mandated penalty, it absolutely is necessary.

Sorry, but I'm increasingly curious if Sir Robin Jacob just really enjoys having power over such a large company and is maybe letting it go to his head a bit. Requiring an apology in the first place was a surprise; the rest just looks like vindictiveness.

Let's be perfectly clear, here: the NEVER required an "apology" of any kind. Apple was merely required to post a statement saying that the UK court ruled that Samsung did not infringe Apple's registered community design. People keep saying Apple was supposed to "apologize," but that's simply not the case at all.

I wonder how much the snarky article that Apple posted (which set all this off) will cost them per word after all the legal fees? Taking into account that they have their own considerable fees plus the Samsung lawyers fees.

It will probably go down as one of the most expensive wiseass stunts ever!

The ruling should be required reading for all of those defending Apple's posting of the "Contested Notice", on the basis of "free speech".

Quoting the judge:"I do not think the order as made precluded any addition to the required notice if that addition had been true and did not undermine the effect of the required notice. But I do consider that adding false and misleading material was illegitimate. For by adding such material the context of the required notice is altered so that it will be understood differently.Here what Apple added was false and misleading. I turn to analyse it."

This is followed by a detailed analysis of exactly why it is false and misleading. And we're not talking mere technicalities, but everything from factual falsehoods to statements carefully calculated to mislead by omission.

Conclusion?"The false innuendo is that the UK court came to a different conclusion about copying, which is not true for the UK court did not form any view about copying. There is a further false innuendo that the UK court's decision is at odds with decisions in other countries whereas that is simply not true.

The reality is that wherever Apple has sued on this registered design or its counterpart, it has ultimately failed. It may or may not have other intellectual property rights which are infringed. Indeed the same may be true the other way round for in some countries Samsung are suing Apple. But none of that has got anything to do with the registered design asserted by Apple in Europe. Apple's additions to the ordered notice clearly muddied the water and the message obviously intended to be conveyed by it."

Again on "freedom of speech":"We also thought it appropriate that the correct statement – the notice required by the original notice – should appear without modification or addition. Apple's previous modifications and additions made it clear that it should not be allowed to do the same or something similar again. Of course that did not preclude it from making statements elsewhere – even untrue ones which might amount to a libel or malicious falsehood. That would amount to a prior restraint which would obviously be inappropriate. All we required is that the notice we ordered should appear unvarnished or unembellished in any way."

And the last paragraph is another must read:"Finally I should mention the time for compliance. Mr Beloff, on instructions (presumably given with the authority of Apple) told us that "for technical reasons" Apple needed fourteen days to comply. I found that very disturbing: that it was beyond the technical abilities of Apple to make the minor changes required to own website in less time beggared belief. In end we gave it 48 hours which in itself I consider generous. We said the time could be extended by an application supported by an affidavit from a senior executive explaining the reasons why more was needed. In the event no such application was made. I hope that the lack of integrity involved in this incident is entirely atypical of Apple."

# Samsung has supported its application by citation from a large number of press and web reports showing that the effect of the Contested Notice has indeed been to undermine what was intended. Our attention was specifically drawn, for instance, to an online magazine called "The Register":

APPLE: SCREW YOU, BRITS, everyone else says Samsung copied us

Apple has complied with a UK court order by admitting on its website that Samsung's Galaxy Tab did not rip off the patented iPad design. High Court Judge Birss had instructed Apple to publish a statement online and in print that the South Korean electronics giant had not infringed Cupertino's patent.

The statement can be found via a small link labelled "Samsung/Apple UK judgement" on Apple's UK homepage and is a mealy mouthed six-paragraph account of the litigation over Apple's registered design.

You can tell by reading between the lines, this was a one pissed off judge.

Here what Apple added was false and misleading. I turn to analyse it. The first sentence reads:

However, in a case tried in Germany regarding the same patent, the court found that Samsung engaged in unfair competition by copying the iPad design.

That is false in the following ways:

(a) "Regarding the same patent." No patent of any kind has been involved in Germany or here, still less "the same patent."

(b) As regards the Community Registered Design, the German Courts held that neither the Galaxy 10.1 nor the 8.9 infringed it. As to the 7.7 there was for a short while a German provisional order holding that it infringed. Whether there was a jurisdiction to make that order is very doubtful for the reasons given in my earlier judgment but in any event the order had been (or should have been) discharged by the time the Contested Notice was published.

(c) There is a finding and injunction, limited to Germany alone, that the 10.1 and 8.9 infringe German unfair competition law. But the statement is likely to be read as of more general application.The second sentence reads:

A U.S. jury also found Samsung guilty of infringing on Apple's design and utility patents, awarding over one billion U.S. dollars in damages to Apple Inc.

That is misleading by omission. For the US jury specifically rejected Apple's claim that the US design patent corresponding to the Community Design in issue here was infringed. The average reader would think that the UK decision was at odds with that in the US. Far from that being so, it was in accordance with it.The third sentence reads:

So while the U.K. court did not find Samsung guilty of infringement, other courts have recognized that in the course of creating its Galaxy tablet, Samsung wilfully copied Apple's far more popular iPad.

This is calculated to produce huge confusion. The false innuendo is that the UK court came to a different conclusion about copying, which is not true for the UK court did not form any view about copying. There is a further false innuendo that the UK court's decision is at odds with decisions in other countries whereas that is simply not true.The reality is that wherever Apple has sued on this registered design or its counterpart, it has ultimately failed. It may or may not have other intellectual property rights which are infringed. Indeed the same may be true the other way round for in some countries Samsung are suing Apple. But none of that has got anything to do with the registered design asserted by Apple in Europe. Apple's additions to the ordered notice clearly muddied the water and the message obviously intended to be conveyed by it.

So, to summarize, Apple has failed on this particular argument in courtrooms around the world. Even in the US court where Apple won a $1 billion verdict, the jury in that particular case, did not find in Apple's favor on the design patents.

theJonTech wrote:

We really need a world court system, one judge one ruling (or even a panel of judges from around the world)

No, we really don't need a world court system so much as we need companies that will obey and respect the law. Apple has failed with the same arguments in courtrooms around the world. In this case, Apple was ordered to tell the truth, in part to undo the public damage it had done to a competitor, and Apple decided that the authority of the court does not apply to Apple. Because, well, because Apple is special.

We don't need a world court because, as shown above, this court's findings were *in accordance* with the findings of courts around the world, on this specific issue. Apple just didn't like that in this case, the court made them publicly correct the false information they had been stating loudly and repeatedly.

The purpose of the court is to follow the law not to "spank" the offending child.

Except for the entire concept of punitive damages, which are by definition to punish, and are used at the court's discretion in many cases.

Give the court the finger, literally or metaphorically, and you can fully expect to be smacked for it. A recent US analogue would be the Apple/Google FRAND case being dismissed with prejudice after Apple basically told the court that they would only abide by the court's ruling if it was in their favor. The court's response was basically to tell them to get lost and never bother them about this matter again.

One cannot both ask the court to intervene on their behalf and refuse to listen to the court when things don't go in their favor.

Sorry, but I'm increasingly curious if Sir Robin Jacob just really enjoys having power over such a large company and is maybe letting it go to his head a bit. Requiring an apology in the first place was a surprise; the rest just looks like vindictiveness.

If you think you're above the law and act in contempt of a mandated penalty, it absolutely is necessary.

The purpose of the court is to follow the law not to "spank" the offending child.

The problem with this whole case, is Apple has won on the same grounds in some cases, and Samsung in others. So other courts of law have found in favor of Apple.

We really need a world court system, one judge one ruling (or even a panel of judges from around the world)

No you are completely wrong, Apple has never won on the same grounds in any case anywhere in the world. Also a central world court system is a horrible idea.

These types of things are going to happen so long as the patent laws are structured as they are. It's one thing if you have a patent for an innovative, new idea ... but when a patent office approves "round corners" or "thin line" or "whatever", people are going to use the "depends on what the definition of is, is" approach.

Gotta wonder how much longer current patent laws can remain so fundamentally broken. The only ones currently profiting from it are law firms and non-producing patent trolls. Any tech company actually involved in making a product must spend at least twice as much in legal fees and lost battles as they gain in successful suits. Reminds me of the copyright field before notions of fair use were defined, the current system is too heavily biased in favor of patent holders at the expense of patent users. Adding insult to injury, the entity holding the patent rarely produces anything with said patent and oftentimes contributed nothing to it's original development.

Your arguments are valid, assuming the subject patents are sufficiently specific and precise to warrant being awarded in the first place.